Explanations for the gender pay gap lack imagination

A friend of mine proudly announced to me recently, that he was advertising for a woman through a new flexibility recruiter who was helping women to more fully participate in the workforce. He went on to tell me that he could access great talent, that was also experienced, but because they want flexibility, they're prepared to trade off remuneration. Those who know me can only imagine my response to my well-intentioned friend included words such as 'exploitation' and 'sex discrimination'.

Monday marked Equal Pay Day.

Of course, this not a day marked in our calendars for celebration. Equal Pay Day calculates the number of days from the end of the financial year that women have to work in order to earn the same as men. This year, using Average Weekly Earnings data from the Australian Bureau of Statistics, the Workplace Gender Equality Agency (WGEA) calculates the national gender pay gap to be 15.3% for full-time employees, a difference of $251.20 per week.

While it is good news that the pay gap has gone down this year, we do note that equal pay for work of equal value has been outlawed for over 30 years.

Much of the commentary and debate centres around "explaining" or as my mother observed, "mansplaining" the reasons for the pay gap.

In my experience, most women understand how the pay gap is calculated. We also understand the reasons for it. But when women are more likely to earn $1million less than their male counterparts over their lifetime, it is time to stop looking for reasons for the pay gap. It's time to reimagine the possibilities for women, and create a vision that sees us close the gap in retirement savings.

Fiona Richardson's Legacy

Last week the world lost an incredibly brave ambassador for gender equality in Minister for Prevention of Family Violence, Fiona Richardson. Her legacy inspires us to challenge the system. And to challenge the system, we need to challenge the beliefs that underpin the reasons for why things are the way they are. How else would we now be in a situation whereby 'domestic violence' is no longer treated as a private matter?

Equal Pay & Limiting Beliefs

When it comes to the gender pay gap, there is a belief system that underpins it that says it is OK to pay someone less if they are at the same level but in different functional areas. A General Manager of Sales, for example, is paid more than a General Manager of People & Culture.

But should they be? What is the rationale for valuing the contributions of the GM of People & Culture more than the contributions of the GM of Sales?

For me, there are two clear reasons why we need to challenge the beliefs that underpin this system:

1. You are now competing with the Gig Economy for the best talent

The current belief system devalues the contributions of those in support functions, and it, combined with a lack of empowerment to have control of their schedules drives women out of the corporate world and into the gig economy. In fact, the number of women entering the gig economy has doubled over the past 10 years, with most working as professional freelancers, direct sellers or through platforms, so that they can also be the primary caregiver in their homes. Significantly though, 86% of female gig workers believe gig work helps them achieve pay parity with men.

2. A strategy lens tells us the support functions are in fact what differentiates you.

If we apply a strategy lens, and look at the strategy guru Michael Porter's value chain, valuing these roles differently doesn't really make sense. Porter’s theory around value chain comprises a total of 9 steps.

There are 5 primary steps, which are the basics in any company and are the activities that provide strength and sustainability to the organization:-

To be competitive, businesses need to differentiate themselves. And Porter tells us, that support activities can make all the difference to our value propositions. For example:

"Human resource management affects competitive advantage in any firm through its role in determining the skills and motivation of employees, and the cost of hiring and training." (Porter, Competitive Advantage, 1985)

Mansplaining the gender pay gap & the secret of change

Last week 122 Male Champions of Change pledged to close the gender pay gap. While this is a welcome commitment (although arguably already the law), the report was a missed opportunity to motivate through a vision that reimagines the potential of women. The focus on equal pay for equal work - addressing the pay gap in "like for like roles: adopted a narrow view of what needs to be addressed: equal pay for work of equal value.

While this is necessary work, if we are serious about transforming the pay gap and achieve gender equality, we need a vision that will transform the economic security of women over their lifetimes, and see them retire with adequate superannuation balances; and that will transform the limiting beliefs that continue to undervalue the contributions of women.

"The secret of change is to focus all of your energy, not on fighting the old, but on building the new."- Socrates

Viva Energy changes the system with a vision of closing the retirement gap

It's why we are so excited by our client, Viva Energy's new initiative. They had a vision to close the retirement savings gap. They started with better parental leave support, and didn't look back. Not only will employees on parental leave receive superannuation payments for the entire period they are on leave, but if they return to work in a part time capacity, they will continue to receive the full time equivalent of their superannuation payments for the next 5 years.

Now that's what I call changing the system.

(Look out for our special event with special guests including Jodie Haydon, GM Human Resources at Viva Energy)

Without a vision for the new, we certainly won't address the underpayment of women in gender-segregated workforces (such as the childcare sector), we won't address the retirement savings gap, and we certainly, as a nation, won't reap the productivity gains economists predict will flow.